Drummond and Lubiton

[2020] FamCA 262

FAMILY COURT OF AUSTRALIA

DRUMMOND & LUBITON [2020] FamCA 262

FAMILY LAW – PRACTICE AND PROCEDURE – application for extension of time in which to commence an appeal from a court of summary jurisdiction – consideration of prejudice to either party – significance of signing documents – whether respondent appreciated the significance of signing consent orders – application granted.

Family Law Act 1975 (Cth)

Gallo v Dawson (1990) 93 ALR 479
Nickel & Nickel [2010] FamCA 422
Toll (FGCT) v Alphapharm Pty Ltd and Others (2004) 211 ALR 342

APPLICANT: Mr Drummond

RESPONDENT: Ms Lubiton

FILE NUMBER: CAC 2132 of 2019

DATE DELIVERED: 20 April 2020

PLACE DELIVERED: Canberra

PLACE HEARD: Canberra

JUDGMENT OF: Gill J

HEARING DATE: 15 April 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Howard

SOLICITOR FOR THE APPLICANT: Robinson & McGuinness

COUNSEL FOR THE RESPONDENT: Mr Warren

SOLICITOR FOR THE RESPONDENT: Andrew Warren & Associates

Orders

1. The time in which the Respondent may institute an appeal from the orders of the Town A Local Court of 8 August 2019 is extended to 4pm on 24 April 2020.

2. In the event that either party seeks an order for costs in respect of the application for an extension of time then that party is to file and serve an outline of argument as to costs by 4pm on 24 April 2020 and the other party may file an outline of argument in response by 4pm on 1 May 2020.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Drummond & Lubiton has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT CANBERRA

FILE NUMBER: CAC2132/2019

Ms Lubiton

Applicant

And

Mr Drummond 

Respondent

REASONS FOR JUDGMENT

introduction

1. Property orders were made in this matter, purportedly by consent, in the Town A Local Court on 8 August 2019. The Respondent seeks an extension of time in which to commence an appeal from those orders to this court.  He filed the application for the extension on 24 October 2019, the period for the filing of an appeal having expired on 5 September 2019.  Should the extension be granted, the matter will be determined on a de novo basis.  The extension is opposed by the Applicant. 

2. The Respondent based the application for extension on his purported failure to appreciate that, in executing consent terms, he was entering into a binding obligation, and further, that he did not appreciate the effect of the terms.  Although in material filed the Respondent denied executing the documents, he did not advance such as a fact to justify an extension.  Rather, he conceded that the application should proceed on the basis of a presumption that the Respondent signed the relevant documents (which was not a concession for the purpose of any other application), that there would be no attempt to prove the contrary, and that a failure to execute the documents would not form a part of the application for an extension of time.

3. This position removed the need for cross examination on the application, which had been provided for on the listing of the matter.  It also removed the need for one of the Applicant’s witnesses, a forensic handwriting expert, Ms B.  The material relied upon is set out at Annexure A, noting that Exhibit C1 was a series of text messages tendered by consent.

The evidence

1. The Respondent’s case pursued an overall conclusion, principally from text messages contained at Exhibit C1, that the Respondent neither considered that the parties had finalised their financial settlement, and nor had they done so in terms of the agreement that he understood was on foot between them.

2. The orders provided for the sale of the parties’ property, with the proceeds to go to sale costs, the discharge of a mortgage, and the balance to the Applicant.  The Respondent received a number of chattels and the company that conducts his business.

3. The Respondent relied upon text messages that were, he asserted, inconsistent with the above terms, and with the finality of the arrangements between the parties.  In general terms this involved repeated comments in the messages by the Respondent where he asserted that:

   a)The parties still needed to sort things out in terms of the property;

   b)That there needed to be a written agreement setting out the breakdown of the sale proceeds;

   c)That there was no agreement between the parties;

   d)That the effects of further drawing down of the mortgage by the Applicant, and the Applicant agreeing to a lower sale price for the property, would need to come out of her share of the proceeds;

4. The Respondent also adduced evidence of various debts owed to family member that he says were not taken into account in the consent terms.

5. On the Respondent’s account he did not become aware that there were orders in place, or of their terms, until in September 2019 when a lawyer advised him of the existence of the orders.  The Respondent led evidence, through that lawyer, of his expressed surprise both at the existence of the orders and that they provided for the retention of all of the net proceeds by the Applicant.  He also led evidence that at some earlier, but indeterminate point, he had expressed to the lawyer that the agreement between the parties provided for some sharing of the net proceeds of the sale.

6. Against this the Applicant pointed to a lack of direct evidence from the Respondent on these matters, noting that he relies upon inferences drawn from the contact with the lawyer and the text messages.  The height of the direct evidence relied upon by the Respondent was his assertion that the first time he saw the orders was 27 September 2019.  While he asserted that he had not seen the settlement documents, for the purpose of the application he did not deny signing the documents which apparently bore his signature. 

7. He asserted that, some time after 20 July 2019, there had been agreement with the Applicant as to the sale proceeds being split after $100,000 was paid to the Respondent’s mother and $325,000 to the Applicant.  The balance of the conversations he deposes to occurred in late September 2019, from shortly before when he says that he became aware of the consent orders.

8. The Applicant also points to the Respondent having executed the statement of truth as part of the application for consent orders, wherein he declared his understanding of, and agreement with, the consent terms.

9. The Applicant’s case was that the text messages relied upon by the Respondent were, at best, ambiguous, while the statement of truth was unequivocal as to the Respondent’s understanding.

10. In response to this, the Respondent asserted that the statement of truth should not be taken seriously, and the court should not, in general, regard that persons signing such documents were doing so truthfully.  This submission sits poorly with cases such as Toll (FGCT) v Alphapharm Pty Ltd and Others.[1]

    [1] (2004) 211 ALR 342

Principles in relation to granting an extension of time to appeal

1. The tension in applications for an extension of time to lodge an appeal derives primarily from competing interests of justice considerations, flowing from the desirability of finality in litigation, predictability and consistency in the conduct of proceedings, and the need to ensure that substantive justice is accorded in proceedings.

2. In Nickel & Nickel,[2] in the context of what McHugh J had said in Gallo v Dawson[3]  that “the object of a power to extend time is to ensure that Rules which fix times do not themselves become the objects of injustice”, O’Reilly J set out the principles in relation to the consideration of the extension of time in which to allow an appeal to be filed:

   The discretion to extend time ought be exercised only upon proof that strict compliance with the Rules will work an injustice upon the applicant. In order to determine whether the Rules would work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation and the consequences for the parties of the grant or refusal of the application.

   [2] [2010] FamCA 422 [4]

   [3] (1990) 93 ALR 479

3. Justice O’Reilly observed that this would normally involve a consideration of the adequacy of reasons to explain the delay, there being a substantial issue to be tried, and hardship to the respondent that cannot be addressed by costs or otherwise.

4. In the present case the explanation for delay is based on either a lack of understanding that the Respondent was entering into a binding obligation and/or a lack of understanding of the content of the obligation.  As noted earlier, for the purpose of this application, the Respondent does not argue that he did not execute the relevant documents, but rather that there was a lack of comprehension as to the effect of the application for consent orders.

5. As noted above, the Respondent asserted a lack of awareness of the orders until September 2019.  His execution of the documents and of the statement of truth undermine this assertion, as do the circumstances and process of the execution of the documents as set out by the Applicant in her material.  If the matter had rested there, the Respondent’s claim would have lacked credibility. 

6. However, the exchange of text messages provides the most persuasive evidence that the Respondent did not appreciate what was going on.  At their clearest, the conflict between the representations in the messages and the orders arises in the Respondent’s assertions that there was a need for a breakdown of the proceeds of the sale of the property, and that the Applicant would have to bear the added mortgage drawings and reduction in sale price from her share.  Neither of these issues arose on a basic understanding of the terms of the orders, which provided for the net proceeds to go to the Applicant.  A breakdown of the proceeds of sale had little or any impact upon the Respondent if he was to receive none.  The added mortgage drawings and reduction in sale price necessarily were matters for the Applicant if she was to receive the whole of the net proceeds, and of no impact upon the Respondent.

7. The text messages inferentially and strongly support the claim of a lack of awareness, despite some aspects of ambiguity.

8. This lack of awareness acts as an explanation of the delay in the institution of the appeal by the Respondent.

9. The delay in pursuit of the appeal was short, although with significant effects given the frustration of a potential sale of the property.  The frustration of the sale poses potential hardship for the Applicant, although the event of that hardship has apparently now passed and is not remedied by the refusal of an extension of time.  Further hardship has been imposed upon the Applicant by the duplication of proceedings in the application to extend time despite the entry into consent terms.

10. The delay in the institution of the appeal also has resulted in additional proceedings in the application for an extension of time.

11. In considering the prospects of the matter on appeal, it is necessary to recognise the nature of the appeal, being in this case a hearing de novo.  Unlike other forms of appeal there is no need to identify particular error, nor is it possible to assess prospects or merits as against such assertions of error.  There may still be cases where even on a de novo appeal it could not be considered that there were any prospects to do better than was obtained, by consent or otherwise, in the Local Court.  Here there will be issues as to contested debts and contributions that mean that the merits of the case, when assessed at face value, could not be considered as lacking.  That is not to predict what the outcome might eventually be, nor to suggest that the Respondent will do better at a de novo hearing than under the consent terms, but rather to say in the context of a de novo hearing the matter cannot be assessed, at this stage, as unmeritorious.

12. These matters, on balance, point to an extension of time being granted as being in the interests of justice, despite their undermining of the finality of the orders made in the Local Court at Town A.

I certify that the preceding twenty-five (25) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Gill delivered on 20 April 2020.

Associate: 

Date:  20 April 2020

Annexure A

Material relied upon

The Husband relied upon the following:

a)Response to Application for Final Orders filed 24 October 2019 

b)Affidavit of Mr Drummond filed 17 February 2020

c)Affidavit of Mr C filed 17 February 2020

d)Affidavit of Mr D filed 17 February 2020

e)Affidavit of Ms E filed 17 February 2020

f)Written Submission filed 8 April 2020

g)Exhibit C1 – Pages in the document ‘Lubiton Documents to be referenced by Applicant.pdf’ pages 332, 391, 407, 423, 467, 484, 485, 498, 500, 517, 518, 519 of 528 and 5, 6, 10, 11, 12, 14, 15, 18, 19, 20, 21 of 21.

h)Exhibit H1 – Consolidated Tender Bundle of the Husband

The Wife relied upon the following:

a)Affidavit of Ms Lubiton filed 1 April 2020

b)Outline of Case filed 14 April 2020

c)Exhibit C1 – Pages in the document ‘Lubiton Documents to be referenced by Applicant.pdf’ pages 332, 391, 407, 423, 467, 484, 485, 498, 500, 517, 518, 519 of 528 and 5, 6, 10, 11, 12, 14, 15, 18, 19, 20, 21 of 21.

d)Exhibit W1 – Consolidated Tender Bundle of the Wife